The Supreme Court has declined to entertain Green Energy Association (GEA) appeal on stopping Renewable Energy Certificates (REC) price revision by Central Electricity Regulatory Commission (CERC).
The top court took cognizance of a matter seeking a stay on REC price revision by CERC on June 16. A bench headed by Justice Arun Mishra refused to entertain the application of GEA.
The GEA contended that each REC it holds, the company should be given 3.5 certificates since the minimum value of certificates was reduced by 3.5 times i.e. from Rs 3,500 to Rs 1,000 by CERC. The Appellate Tribunal of Electricity (APTEL) reduced the price band for solar RECs from (Rs 3,500 (minimum/floor) – Rs 5,800 (max/forbearance) to Rs 1,000 (minimum/floor) – Rs 2,400 (max/forbearance).
GEA in its application sought a stay on the proceedings where CERC has now proposed to further reduce the minimum/floor price of the certificate to Rs 0 (Zero).
“If this is permitted, even if the relief sought in the appeal is granted by the court, that is Supreme Court grants 3.5 certificates for each certificate, there would be no guaranteed minimum at which the Appellant (GEA) can sell those certificates. The very purpose of asking for 3.5 certificates for one certificate will get defeated i.e. the Appellant companies will lose value drastically,” said the plea by GEA.
According to sources, the decision of the apex court is an important development, as the high prices of RECs had been causing an additional burden to the tune of Rs 654 crore annually (based on FY19-20 figures from Power Exchange) on the consumers in power tariffs.
Experts in the industry say that the impact would be much higher in the coming years when compliance levels are expected to rise. The top court summarily dismissed any prayers of stay on CERC order realizing the impact that the delay in regulations can create.